Czech job vacancies soared above 100,000 in August for the first time since 2008, as many companies struggle to find enough qualified staff in a bustling economy with one of the lowest unemployment rates in Europe.
The export-heavy economy grew by 4.4% year-on-year in the second quarter, the fastest rate in the European Union, thanks to rising orders and strong household demand, along with an inflow of EU development subsidies.
The growth spurt in one of the EU’s most industrialised states is putting more people back to work, but also forcing companies to search longer and wider to fill spots.
“We are growing like crazy but we could grow even more if we didn’t have 100,000 free jobs that employers are not able to fill with the right people,” said Radek Spicar, a vice-president of the Industry Confederation, the biggest employers association.
The jobless rate in the country of 10.5 million fell in August to 6.2%, matching a four-year low hit in June. In the past year, it has dropped from 7.4%, while the number of vacancies has almost doubled to 103,768.
The data show how the Czech Republic has put the recession-plagued years following the 2008 financial crisis behind it. They stand in sharp contrast to the still-tough situation in much of the EU, which is trying to spur investment and jobs.
In the bloc’s southern flank, the unemployment rate is often in double digits, and runs as high as a quarter of all workers in Greece. In July, the EU’s overall jobless rate was 9.5%.
Bring more workers
Pars Nova, a firm that upgrades rail cars, said it was having trouble filling 70 jobs, including welders, electricians and technicians, to keep up with an order book that grew by 25% in the second quarter.
HR director Lucie Novotna said the market resembled the boom years before 2008, when shortages of qualified labour posed a headache.
“It was very problematic to cover production orders in those years,” she said. “If we are not able to fill customer orders, it can have a future impact.”
Many other businesses are also contending with rising vacancies. Apart from offering better conditions, some are starting to look abroad for labour.
The Industry Confederation has pushed the government to make it easier and quicker for companies to recruit from outside the EU, for example from Ukraine.
Analysts expect the number of jobless to continue to fall. That bodes well for future wage growth, something the central bank needs to see before it can drop its expansionary policy of keeping the crown weak in order to lift inflation.
Annual inflation was at 0.5% in July, well below a target of 2%.
“Czech economic growth is giving a clear signal: the number of people without work should continue to fall as firms have the need to take on more workers,” said Radomir Jac, chief economist at Generali Investments CEE.